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Equity Plans and Stock-Based Compensation | 9 Months Ended
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Sep. 30, 2018
Share Based Compensation [Abstract] |
Equity Plans and Stock-Based Compensation | 12. Equity Plans and Stock-Based Compensation On May 31, 2018, our stockholders approved the 2018 Equity Incentive Plan (the “2018 EIP”). The 2018 EIP is intended to be the successor to and continuation of the Dynavax Technologies Corporation 2011 Equity Incentive Plan (the “2011 EIP”). The aggregate number of shares of our common stock that may be issued under the 2018 EIP (subject to adjustment for certain changes in capitalization) is comprised of the sum of (i) 5,000,000 newly reserved shares of common stock, (ii) 140,250 unallocated shares of common stock remaining available for grant under the 2011 EIP as of May 31, 2018, and (iii) 7,477,619 shares subject to outstanding stock awards granted under the 2011 EIP and the Dynavax Technologies Corporation 2017 Inducement Award Plan that may become available from time to time as set forth in the 2018 EIP. Option activity under our stock-based compensation plans during the nine months ended September 30, 2018 was as follows (in thousands except per share amounts):
|  | Shares Underlying Outstanding Options (in thousands) |  |  | Weighted-Average Exercise Price Per Share |  |  | Weighted-Average Remaining Contractual Term (years) |  |  | Aggregate Intrinsic Value (in thousands) |
Balance at December 31, 2017 |  |  | 3,555 |  |  | $ | 19.56 |  |  |  |  |  |  |  |  |
Options granted |  |  | 2,386 |  |  |  | 16.56 |  |  |  |  |  |  |  |  |
Options exercised |  |  | (40 | ) |  |  | 11.95 |  |  |  |  |  |  |  |  |
Options cancelled: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Options forfeited (unvested) |  |  | (139 | ) |  |  | 13.89 |  |  |  |  |  |  |  |  |
Options expired (vested) |  |  | (79 | ) |  |  | 30.61 |  |  |  |  |  |  |  |  |
Balance at September 30, 2018 |  |  | 5,683 |  |  | $ | 18.33 |  |  |  | 5.76 |  |  | $ | 1,448 |
Vested and expected to vest at September 30, 2018 |  |  | 5,422 |  |  | $ | 18.41 |  |  |  | 5.72 |  |  | $ | 1,419 |
Exercisable at September 30, 2018 |  |  | 2,766 |  |  | $ | 20.01 |  |  |  | 5.14 |  |  | $ | 927 |
Restricted stock unit activity under our stock-based compensation plans during the nine months ended September 30, 2018 was as follows (in thousands except per share amounts):
| Number of Shares (In thousands) |  |  | Weighted-Average Grant-Date Fair Value |
Non-vested as of December 31, 2017 |  | 2,443 |  |  | $ | 6.01 |
Granted |  | 452 |  |  |  | 16.04 |
Vested |  | (1,049 | ) |  |  | 5.91 |
Forfeited |  | (51 | ) |  |  | 7.79 |
Non-vested as of September 30, 2018 |  | 1,795 |  |  | $ | 8.54 |
The aggregate intrinsic value of the restricted stock units outstanding as of September 30, 2018, based on our stock price on that date was $22.3 million. Fair value of restricted stock units is determined at the date of grant using our closing stock price. As of September 30, 2018, approximately 151,000 shares underlying stock options and approximately 12,500 restricted stock unit awards with performance-based vesting criteria were outstanding. Vesting criteria for 12,500 of the awards with performance-based vesting criteria were not probable as of September 30, 2018. We recognized stock-based compensation expense for awards with performance-based vesting criteria of $0.4 million and $1.1 million for the three month and nine month periods ended September 30, 2018, respectively. Under our stock-based compensation plans, option awards generally vest over a three or four-year period contingent upon continuous service, and expire seven to ten years from the date of grant (or earlier upon termination of continuous service). The fair value-based measurement of each option is estimated on the date of grant using the Black-Scholes option valuation model. The fair value-based measurements and weighted-average assumptions used in the calculations of these measurements are as follows:
| Stock Options |  |  | Stock Options |  |  | Employee Stock Purchase Plan |
| Three Months Ended |  |  | Nine Months Ended |  |  | Nine Months Ended |
| September 30, |  |  | September 30, |  |  | September 30, |
| 2018 |  |  | 2017 |  |  | 2018 |  |  | 2017 |  |  | 2018 |  |  | 2017 |
Weighted-average fair value | $ | 9.36 |  |  | $ | 8.11 |  |  | $ | 10.91 |  |  | $ | 4.73 |  |  | $ | 8.30 |  |  | $ | 3.05 |
Risk-free interest rate |  | 2.8 | % |  |  | 1.9 | % |  |  | 2.6 | % |  |  | 1.9 | % |  |  | 2.4 | % |  |  | 1.0 | %
Expected life (in years) |  | 4.5 |  |  |  | 4.5 |  |  |  | 4.5 |  |  |  | 4.5 |  |  |  | 1.3 |  |  |  | 1.2 |
Volatility |  | 0.9 |  |  |  | 0.9 |  |  |  | 0.9 |  |  |  | 0.9 |  |  |  | 1.1 |  |  |  | 1.0 |
Compensation expense is based on awards ultimately expected to vest and reflects estimated forfeitures. The components of stock-based compensation expense were (in thousands):
| Three Months Ended |  |  | Nine Months Ended |
| September 30, |  |  | September 30, |
| 2018 |  |  | 2017 |  |  | 2018 |  |  | 2017 |
Research and development | $ | 2,332 |  |  | $ | 1,973 |  |  | $ | 7,194 |  |  | $ | 5,707 |
Selling, general and administrative |  | 2,976 |  |  |  | 1,687 |  |  |  | 8,561 |  |  |  | 5,137 |
Cost of sales - product |  | 443 |  |  |  | - |  |  |  | 1,085 |  |  |  | - |
Inventory |  | 295 |  |  |  | - |  |  |  | 295 |  |  |  | - |
Total | $ | 6,046 |  |  | $ | 3,660 |  |  | $ | 17,135 |  |  | $ | 10,844 |
As of September 30, 2018, the total unrecognized compensation cost related to non-vested equity awards including all awards with time-based vesting amounted to $31.2 million, which is expected to be recognized over the remaining weighted-average vesting period of 2 years. Additionally, as of September 30, 2018, the total unrecognized compensation cost related to equity awards with performance-based vesting criteria amounted to $0.7 million. Employee Stock Purchase Plan The 2014 Employee Stock Purchase Plan, as amended, (the “Purchase Plan”) provides for the purchase of common stock by eligible employees and became effective on May 28, 2014. On May 31, 2018, our stockholders approved an amendment to the Purchase Plan to increase the aggregate number of shares of common stock authorized for issuance by 600,000. The purchase price per share is the lesser of (i) 85% of the fair market value of the common stock on the commencement of the offer period (generally, the sixteenth day in February or August) or (ii) 85% of the fair market value of the common stock on the exercise date, which is the last day of a purchase period (generally, the fifteenth day in February or August). For the nine months ended September 30, 2018, employees have acquired 125,193 shares of our common stock under the Purchase Plan and 573,034 shares of our common stock remained available for future purchases under the Purchase Plan.

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- Definition The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -URI http://asc.fasb.org/topic&trid=2228938 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 50 -URI http://asc.fasb.org/subtopic&trid=2208855 + Details
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